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House approves Bailey proposal to close
retire-rehire loophole
Measure would make law uniform among teachers,
public employees
A bill prime sponsored by
Rep.
Barbara Bailey that would close an unintended loophole in the
state's 2001 retire-rehire law cleared the House of Representatives
today, 93-2. The loophole allows teachers in the TRS-1 (Teachers'
Retirement System) pension plan to retire in name only and immediately
return to their old jobs while collecting retirement checks.
"The retire-rehire bill
was passed in 2001 to allow retired teachers in the TRS-1 pension plan
to return to work and be employed up to 1,500 hours per year without
reducing their retirement benefits. The measure was intended to address
a problem with teacher shortages in the schools," said Bailey, R-Oak
Harbor. "Unfortunately, some were abusing that law. People were retiring
in name only without really retiring. They were returning to the same
job, the same desk, at the same salary while receiving their retirement
checks. And others were not given an opportunity to be considered for
that job."
Bailey said the
Legislature approved her legislation in 2003 to address the issue. The
2003 legislation increased the time of separation, required agencies to
document shortages before they could rehire a retiree, and banned verbal
agreements that a worker could come back. The changes were to apply
equally to teachers and state workers. However, Gov. Gary Locke vetoed
the section applying to teachers.
"That set up a disparity
between the PERS and TRS retirement systems which I've been trying to
correct for the past four years. The legislation I'm proposing this year
would make the law uniform among teachers and public employees, and it
would provide an equitable agreement that closes this disparity while
upholding the spirit of the original law."
House Bill 1262 defines separation from service in TRS as excluding
circumstances where an employee and his/her employer have an oral or
written agreement to return to work following termination. In both the
PERS (Public Employees Retirement System) and TRS system, inquiries
about post-retirement employment would not constitute an agreement.
"TRS retirees would be
required to have at least 45 days of separation from their old job.
It also limits the amount of hours they could work before their pension
is affected," added Bailey.
"Hopefully this
legislation will also be approved in the Senate and become effective to
make the law work as it was originally intended. Retired teachers who
return to work would still be able to collect their retirement checks.
However, this bill would implement tighter restrictions around the
rehire process and finally restore equity to the system," said Bailey.
"We want to make sure if there's a real need for a teacher and no
qualified applicants to fill that position, a retiree can come out of
retirement without being penalized. However, we don't want pre-existing
agreements or a 'wink and a nod' that would let people come back to
their same jobs without really retiring."
The measure now goes to
the Senate for further consideration.
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For more information, contact: John
Sattgast, Information Officer: (360) 786-7257
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